If you're planning to buy a king-sized mattress or sleek new smartphone, you might want to think twice before setting a budget. Research released by two U.S. universities suggests that imposing a price limit on a purchase can actually increase the amount you would otherwise spend.

Researchers came to this conclusion after running a series of experiments involving setting targets and maximum prices for various items, including laptops, Blu-ray players and pens.

In one particular test, participants were asked how much they would spend on a 32-inch high-definition television set. Next they were offered the choice of buying a "higher quality" set for $18 above their target price or a "lower quality" set priced $18 below.

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More than 50 per cent chose the higher-priced model, despite the fact that it was above their price goal. But among subjects given the same options, without being asked how much they would be willing to spend initially, only about a third chose the more expensive option.

"We don't mean to repudiate budgeting, because its positives probably still outweigh the negatives," said author Jeffrey S. Larson, assistant professor of marketing at Brigham Young University's Marriott School of Management. "But it's important for consumers to realize how budgeting can affect our thought process and actually prompt us to spend more than we intended."

Mr. Larson explains the phenomenon this way: When price is at the forefront of our decision making, we narrow our options based on price. But once we set that initial price, we start to notice that higher-priced items within our range tend to have more features, so we start leaning toward those. So once we've screened our choices based on price, it starts losing its currency and so we start zeroing in almost exclusively on quality. And better quality products usually cost more.

Laurie Campbell, chief executive officer of Credit Canada, admits she was surprised by the results of the study.

"People can be quite set on what they're willing to spend," she said, "so I am curious as to the mindset of those individuals who derail their budget when making the purchase"

She acknowledges, however, that without sufficient research, patience and self-discipline on the part of the consumer, budgeting isn't always effective. So to avoid going overboard the next time you go shopping, she offers the following advice:

Go comparison shopping

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This is an obvious one, but websites like ShopBot and Sortable will give you a realistic idea of what items costs, and prevent sticker shock at the time of purchase.

Be flexible

In cases where a cheaper items may break down over time, it may make sense to spend a little more for quality, even if it means holding off a month or two before you can afford the higher-priced item.

Don't get caught in the heat of the moment

Before making any major purchases that stray from the original constraints of your budget, step away and ask yourself why exactly you want to go outside of your range; are the reasons logical or passionate? Getting perspective will help you avoid making a regretful purchasing decision.

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